China has blocked SoftBank Group’s proposed $5.4 billion acquisition of ABB’s robotics business, dealing a significant setback to the Japanese technology investor’s plans to expand its presence in industrial robotics and physical artificial intelligence.
The decision was confirmed by ABB on November 5, according to reports by The Japan Times and Silicon UK, following a Chinese government review of the transaction on national security grounds.
The acquisition, announced in October 2025, would have given SoftBank control of one of the world’s leading industrial robotics manufacturers, with more than 7,000 employees and an established customer base across automotive manufacturing and other industries.
The deal was a central part of SoftBank founder Masayoshi Son’s strategy to combine artificial intelligence with physical machines, bringing AI capabilities into factories and other industrial environments.
China’s intervention raises questions about the future ownership of ABB’s robotics division and the increasing importance of industrial robotics technology in international economic competition.
Chinese operations at the center of the dispute
According to ABB’s official statement, the decision was made by China’s Office of the Working Mechanism for Foreign Investment Security Review.
ABB said: “ABB confirms that it has been informed by SoftBank that the Office of the Working Mechanism for Foreign Investment Security Review in China has prohibited the acquisition of the ABB Robotics business in China.”
Importantly, the companies have not announced the cancellation of the entire transaction. ABB said both sides remained in discussions and were working constructively on the proposed sale.
SoftBank also issued an official statement on November 6, confirming that it received notification of the prohibition on November 4 and was continuing discussions with ABB.
China is ABB Robotics’ largest market, according to reporting by Silicon UK, with more than 90 percent of the robots supplied to Chinese customers manufactured locally.
ABB has operated in China for decades and opened a $150 million robotics manufacturing facility in Shanghai in 2022.
The company’s substantial manufacturing and research operations in the country have made Chinese regulatory approval particularly important to the proposed acquisition.
Concerns over robotics data and AI
The Financial Times, as reported by Silicon UK, said Chinese authorities had examined the possibility that robotics data generated in China could be transferred overseas and used to train artificial intelligence models.
The concerns reportedly included SoftBank’s relationship with OpenAI, in which the Japanese company has made substantial investments.
The review also reportedly considered arrangements that would keep certain intellectual property and manufacturing capabilities within China.
Neither ABB’s nor SoftBank’s official statements specified the reasons for the prohibition.
The intervention highlights the growing strategic importance of industrial robotics as manufacturers and technology companies seek to develop AI systems capable of operating in physical environments.
For SoftBank, ABB Robotics represented an opportunity to combine an established industrial manufacturing business with its investments in emerging AI and robotics companies.
The proposed acquisition was intended to complement SoftBank’s existing interests in companies including Berkshire Grey, AutoStore, Agile Robots and Skild AI.
In announcing the agreement in October 2025, Masayoshi Son, chairman and CEO of SoftBank Group, said: “SoftBank’s next frontier is physical AI.”
The Chinese decision leaves that strategy facing a significant regulatory obstacle.
For ABB, meanwhile, the immediate question is whether the companies can find an alternative structure that satisfies Chinese authorities, or whether the engineering group will need to reconsider its plans for the robotics division.
Neither company has announced a revised timetable or an alternative transaction structure.
